After more than a half century in the heart of the Cherry Creek neighborhood, the Safeway next to the Cherry Creek Shopping Center will be closing its doors by the first week of January, officials announced today.
The 51-year-old Safeway with approximately 50,000 square feet at 3100 E. First Ave., has been notified by the Taubman Co., the owner of the Cherry Creek shopping center, that the store must vacate its space by Jan. 4.
The existing single-story store building likely will remain and be “repurposed” with other tenants, said Nick LeMasters, the general manager of the Cherry Creek Shopping Center.
The Safeway at Cherry Creek has lost its lease and will be closing. Photo by Pat Adams
Observers have speculated for years that if Safeway ever left the building it would be torn down and possibly replaced with a dense, mixed-use development.
“To the best of my knowledge, there are no plans to rezone the site,” LeMasters said. “If you are asking me if we are planning to tear it down and replace it with something else, I don’t think that is likely to happen.”
The site is zoned B-3, which is an “old-code zone district,”noted Andrea Burns, communications director for the Denver Community Planning & Development office.
“It’s a commercial district that allows for a variety of mixed uses, including residential, commercial retail, office, lodging” and other uses, Burns said.
“Size height of the building is tied to a 1:1 floor-area ratio, and a bulk plane envelope, but no height limit per se,” she added.
Rather than rezone and replace the the existing building, which long predates the 27-year-old shopping center, the grocery store would serve as a home to one or more new tenants.
“We are looking at our options, and there are some things in the works right now, but it’s nothing I can release at this time,” LeMasters said.
He said it is hard to say how many tenants the building could house.
“It could be cut up in a lot of different ways,” LeMasters said. “We’ll just have to wait and see.”
Asked if he thought a single tenant could take the entire building, LeMasters replied, “Yes. I think that could be possible. Really, anything is possible.”
One thing Taubman will not do is sell the site to a developer. The Safeway building sits on a 135,000-sf site, according to city records.
“We plan to hold on to this asset,” LeMasters said. “We think the building has tremendous value now and down the road. Tenants already are showing a great appetite for that property.”
The Safeway building will not be physically connected to the shopping center.
The Safeway will not be physically connected to the Cherry Creek Shopping Center, even though the grocery store is leaving.
“We looked at that possibility a number of years ago and it would be quite a complex undertaking,” LeMasters said. “It’s really not feasible to physically connect the building to the shopping center, so we never really considered that as an option.”
The Safeway and the shopping center, for that matter, are in the epicenter of one of the most affluent neighborhoods in Denver.
The median household income within a 1-mile radius of the Safeway is $120,882, and the median value of a house is $780,965, according to CoStar.
The lease with Safeway originally expired in December 2015.
“We were able to extend it for another two years, but we couldn’t continue to extend the lease agreement because of longstanding contractual obligations,” LeMasters said.
He said he is not at liberty to release who the contractual obligations are with.
Nick LeMasters is the longtime general manager of the Cherry Creek Shopping Center.
“Safeway has been an excellent tenant and a valued part of the community. We’ve really enjoyed having Safeway as a tenant all of these years,” according to LeMasters. “We appreciate that some people may feel inconvenienced by its closing, though the area has many other options, including six grocery stores less than a mile and a half from this location. This move underscores the changes happening in the retail sector and the Cherry Creek shopping district, as well as our commitment to Cherry Creek Shopping Center’s continued success as the region’s premier shopping destination,” he continued.
The parking lot in front of the Safeway is subject to the same paid parking rules that went into effect for the Cherry Creek Shopping Center early this year.
Taubman’s decision to not extend Safeway’s lease and the paid parking system are not connected.
“The new parking system had no impact on our decision” to not extend Safeway’s lease, LeMasters said.
Safeway is owned by Albertsons.
“We are certainly disappointed having to close this store as it’s been a fixture in the Cherry Creek neighborhood for the past 51 years,” Todd Broderick, president of Albertsons/Safeway Denver division, said in a statement.
“We’ve been a longtime partner to many community organizations in and around Cherry Creek and we are grateful to our customers who patronized the store,” Broderick continued.
“We hope to be given an opportunity to return to the area as the mall considers redevelopment plans over the next several years.”
